Colorado HB26-1210: Surveillance Pricing and Algorithmic Wage-Setting Bill Awaits Governor Action

A new Colorado bill targets a growing concern in the digital economy: whether companies can use personal data to tailor the price a consumer pays or the wage a worker receives. HB26-1210, now awaiting action by Governor Polis, would limit the use of “surveillance data” in individualized pricing and compensation decisions.

The governor may sign, veto, or allow the bill to become law without signature. If enacted, it would take effect on August 12, 2026, unless a referendum petition is filed.

Importantly, the bill does not prohibit dynamic pricing, personalized offers, or wage variation as such. Instead, it focuses on whether algorithmic tools rely on surveillance data in a way that materially influences the specific price or wage offered to an individual.

What the Bill Would Regulate

At a high level, the bill regulates certain uses of automated tools that rely on personal data in individualized price and wage setting.

The bill would add a new Part 19 to the Colorado Consumer Protection Act addressing these practices.

The key concept is a “price or wage setting algorithm,” or PWSA, which the statute defines broadly. A PWSA includes any technology, software, program, machine-based system, or computational process that uses “statistical modeling, data analytics, artificial intelligence, or other data processing techniques” to analyze data and play a role in determining the price or wage offered to an individual.

Notably, the law applies only where the algorithm is a “substantial factor” in the outcome—meaning more than a de minimis or incidental factor.

The other critical concept is “surveillance data.” The bill defines this term broadly to include data obtained through observation, inference, or surveillance of a consumer or worker. This includes information relating to personal characteristics, online behaviors, or biometrics, whether tied to an individual or to a group, band, class, or tier. It also includes data that is gathered, purchased, or otherwise acquired.

In practical terms, the bill is focused on situations where algorithmic tools use personal or behavioral data—whether observed, inferred, or obtained from third parties—to materially affect individualized price or wage outcomes.

Why Companies Should Care

HB26-1210 may be relevant to companies that use data-driven tools to influence functions such as:

• prices, fees, discounts, or personalized offers;
• loyalty, membership, rewards, or promotional pricing;
• app-based labor or gig compensation;
• wage offers, incentives, bonuses, commissions, or task assignments;
• customer segmentation, personalization, or revenue optimization;
• third-party pricing, analytics, or compensation vendors.

Among these areas, the wage side deserves particular attention. “Wage” is not limited to hourly pay or salary. It includes material terms offered to a worker in exchange for labor, including bonuses, commissions, other incentives, and task assignments that have a direct impact on earnings.

What Companies Should Review Now

Companies with Colorado-facing pricing, compensation, or platform models should begin with a factual inventory of systems that affect individual prices or wages. As an initial step, key questions include:

• Which tools influence prices, offers, wages, incentives, commissions, bonuses, or task assignments?
• What data does each tool use, including inferred data, purchased data, behavioral data, biometric data, transaction history, browsing history, app usage, worker performance data, or customer segmentation?
• Is the tool’s output more than a de minimis or incidental factor in the final price or wage?
• Which systems are internal, and which are vendor-managed?
• Do consumer-facing terms, worker disclosures, loyalty program terms, and internal procedures accurately describe how the systems operate?
• Can the company explain the data inputs, model outputs, vendor role, and human review process if asked by the Colorado Attorney General?

Colorado AG Enforcement

HB26-1210 would place covered algorithmic price and wage-setting practices inside the Colorado Consumer Protection Act. A violation of the new Part 19 would be a deceptive trade practice, and the Attorney General may adopt rules as necessary to implement and enforce the law.

For companies, the enforcement issue is practical. A Colorado AG inquiry would likely examine how the system works, what data it uses, what consumers or workers were told, how vendors were managed, and whether written procedures match the actual operation of the pricing or wage-setting tool.

Conclusion

Companies that use data-driven pricing, compensation, customer segmentation, loyalty, discounting, or platform-based labor tools should consider whether HB26-1210 may require closer review of Colorado-facing operations if the bill becomes law. In particular, companies should assess whether any system materially influences individualized prices or wages based on surveillance data, and whether existing disclosures, governance, and vendor arrangements align with that risk profile.

We are continuing to monitor developments around HB26-1210 and similar legislation. If you have questions about how this bill may affect your pricing, compensation, or data practices, please contact Michael Kilgarriff or your regular Buchalter contact.

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